Monday, 16 February 2015
Government debt further batters Nigeria's economy
Nigeria's economy currently hangs in the balance.
The country which once enjoyed debt relief is on the path of being strangulated by external debt worth trillions of Naira.
More worrisome is the fact that, as the debt climbs higher, there are no visible alternative to pay back the loans aside from oil. Unfortunately, oil prices have continued to fluctuate.
And with more oil being found around the world, Nigeria could be in for a complete economic meltdown in the next two years.
The country's debt profile from 2003 till date witnessed an unpleasant progression since 2006, when the Paris Club wrote off Nigeria's debt.
In 2003, the debt ratio was valued at 46. 8. it dropped to 8.1 after the debt relief in 2006. But now, Nigeria’s total debt stock has risen to a very high level of N10.4 trillion as at June 2014 which is valued at 10.6.
The rising debt profile of the country is made up of external debt stock of N1.46 trillion ($9.377billion) and Federal Government domestic debt of N7.421 trillion ($47.653billion). States in the federation have a domestic debt stock of N1.551trillion or $9.963 billion.